OUTA takes on the Guptas’ banks

Johannesburg - The Organisation Undoing Tax Abuse (OUTA) is
closing the taps on the Guptas' finances by taking action against their banks,
the Bank of Baroda and the State Bank of India, for failure to comply with
the banking laws.

Chief Operations Officer of OUTA
Ben Theron said “We have compiled evidence to take action against these banks
and handed it to the Registrar of Banks and the Financial Intelligence Centre
(FIC)”.

“We want these authorities
to act to ensure that the Bank of Baroda and the Bank of India cease all
business with the Guptas, and revoke their licences to trade within South Africa.”

In August 2016, the FIC
listed 72 suspicious transactions on Gupta-linked bank accounts, which took
place from December 2012 to June 2016 and involved a total of R6.839 billion;
various banks subsequently closed the Guptas bank accounts.

OUTA's investigation found
suspicious financial transactions predating that list, from 2002 and stretching
over years.

“We found that the
businesses linked to the Guptas bought properties over more than a decade for a
total of R245 million – more than R50 million was paid in cash – but managed to
get bonds on these properties totalling nearly R1 billion, an amount that far
exceeds the value of these properties.

The Bank of Baroda provided
bonds valued at R811 million and the Bank of India provided bonds of R176
million; the remaining R11 million came from FirstRand. The transactions linked
to the Bank of Baroda and the Bank of India is particularly problematic,” said Theron.

Theron said some properties
appear to have had massively inflated values. For example, the Guptas’
company Islandsite 180 bought two Cape Town flats in 2006 for R2.8 million each
and two years later the Bank of India generously provided bonds of R24 million
on each flat. This is 8.5 times the purchase price.

“In another instance, the
Guptas’ company Confident Concept bought a farm in Mpumalanga for R40 million
but a year later this was bonded by the Bank of Baroda for R426 million: more
than 10 times the purchase price.

These bonds are apparently
still active,” said Theron .

OUTA asked the financial
authorities to investigate these deals.OUTA is
#ArrestingStateCapture by taking action against those who have deliberately
aided or participated in the capture of the South African state.